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Unions at odds with federations over PIC’s loan to Eskom

09 February 2018 - 05:59
Theto Mahlakoana

Loan fallout: Cosatu spokesman Sizwe Pamla says unions look out for members while the federation has broader interests. Picture: SUPPLIED

Public sector unions the National Education, Health and Allied Workers Union (Nehawu) and the Public Service Association (PSA) are at loggerheads with their mother bodies over the Public Investment Corporation’s (PIC’s) decision to advance R5bn to Eskom.

While federations Cosatu and the Federation of Unions of SA supported the move, the two affiliates were opposed to it, fearing it would set the tone for other state-owned companies experiencing cash flow problems as a result of mismanagement and corruption.

The PIC and Government Employees Pension Fund (GEPF) announced on Monday that they would advance the much-needed funds to Eskom, which still needs to raise R20bn in February for operational costs until the end of the financial year in March.

Public sector unions and their federations had at the end of 2017 started talks on how to form a united front to protect workers’ pensions that are managed by the GEPF and invested in by the PIC.

They also complained about not being consulted about the loan, although the PIC has since apologised for the oversight.

However, the clash over the Eskom bridging facility, which is meant to pay for services and salaries in February, has seen the parties on opposing ends.

In separate interviews with Business Day, the unions and its federations insisted their overall campaign for the independence of the PIC was still in full swing despite their differences over the Eskom matter. The federations argued that there was a bigger picture to take into consideration as Eskom was critical to the country’s economy, while they also had to weigh the interests of the 47,000 employees at the power utility.

Cosatu spokesman Sizwe Pamla told Business Day that they understood the individual unions had to look after their members’ interests while theirs were much broader.

"We want a proper engagement with the PSA to clarify Cosatu’s position and reconcile our views and continue to keep a united front against the raiding of retirement funds by either government or the private sector," Pamla said.

The PSA, which forced its federation, Fedusa, to retract a supportive statement it issued on Monday after the temporary loan was announced, accused Cosatu of "playing politics".

"We are headed for a confrontation with Cosatu, they want Deputy President Cyril Ramaphosa to succeed and are coming up with innovative explanations for this. They are playing politics," he said.

Cosatu backed Ramaphosa’s bid to become ANC president ahead of the governing party’s December conference.

Nehawu said that it did not have different ideologies to Cosatu but felt it was too early for the PIC to bet on the recently appointed Eskom board.

The union’s general secretary, Zola Saphetha, said the power utility was an institution captured by corruption.

"We can’t rely on the Eskom management, and that is what worries us," he said.